Redhall Group to raise £5.8m in share placing

11th Sep 2015 08:13

(ShareCast News) - Redhall Group intends to raise up to £5.8m through a placing and open offer of up to 115.3m shares at 5p per share.The manufacturing and specialist services group said the placing and a debt conversion it has agreed with Henderson and HSBC have the potential to reduce debt by up to £8.3m.The issue represents a discount of around 50.6% to the closing price of 10.125p on Thursday.The conversion will allow £3m of the Henderson debt to be converted as consideration for the issue of 41.5m shares at the issue price plus 18.5m conversion options.Redhall said the additional funding will support the growth of its existing businesses following the successful completion of the first stage of its turnaround.Chief executive Phil Brierley said: "We have made significant progress in the past year in transforming Redhall into a company focused on multi-disciplinary manufacturing and specialist services, which offer higher margins and lower risks."The proposals announced today, through restructuring the balance sheet and providing additional funding, will position Redhall to take advantage of the significant growth opportunities in our marketplace."At 0821 BST, Redhall shares were down 21% at 8.00p.